A contractor calls on a Thursday. He runs a dozen trucks and a yard tank, he is tired of his current supplier, and he has a number in hand from another jobber. He wants to know if you can beat it. This is the moment a lot of margin gets made or given away, because the easy answer is yes, shave a couple of cents, win the account, sort it out later. Later is usually when you find out what you agreed to. There is a better way to handle the call, and it starts before you ever say a price.
Know your real cost before you quote
The number you cannot go below is your laid-in cost to serve this account, and it is not the rack. It is the rack plus freight plus what it actually costs to put fuel in this customer's tank. A 200-gallon top-off forty miles out the highway costs you more per gallon than a 6,000-gallon drop in town, and if you price both off the same blended average, you are quietly losing on one to win on the other. Work out the real cost to serve for this account first. Then you know where the floor is, and you are not guessing in the middle of a phone call.
Price as a differential, not a flat number
Here is the difference between a price you regret and one you do not. Quote a flat cents-per-gallon number and you have placed a bet on the market. The rack moves against you and your margin goes with it. Quote your price as the rack or a published index plus a set margin, and your margin holds whatever the market does. The customer still sees a fair, moving price. You still make your cents on every gallon. A differential is a business. A fixed price is a wager you did not mean to place.
Mind the lowball trap
An account won on price alone is an account you will lose on price alone. The customer who left his last supplier over two cents will leave you over two cents, and you will have trained him to. There is a quieter cost too. A price set low to win today becomes the price you are stuck at when your own costs climb next year, and raising it later is a harder conversation than starting fair would have been. Say it to yourself plainly before the call. Winning is not the goal. Keeping a profitable account is.
Put the terms where you can find them
Price is only half the deal. Write down how the price is set, the index and the differential, so there is no argument later about what the price was. Write down the payment terms and what happens when they slip. Spell out the fees that are real, freight, environmental, after-hours, and the minimum drop you will run. None of this has to be a thick contract. It has to be clear enough that the first invoice question is settled by reading the page instead of by who remembers the conversation better.
Know what you will walk away from
The last piece of pricing a new account well is being willing not to. Some accounts cannot be won above your cost to serve, and those are the other fellow's headache, not yours. Saying no to a badly priced account is not lost business. It is the thing that protects the margin on the good accounts you already have. A floor you will not cross is worth more than any single customer who wants you to cross it.
Pricing a new account well has less to do with the number and more to do with how the number is built. Off your real cost, as a differential so your margin survives the market, with the terms written where anyone can read them, and a floor you hold. Handle the Thursday call that way and the account is still earning its keep six months on, instead of being the one you wish you had priced differently. The customers worth keeping respect a fair price held steady. The ones who only ever want the lowest will be someone else's problem soon enough.